Andersen Legal, through Scottish member firm Dundas & Wilson, has secured first-round funding for technology start-up Intense Photonics in its first arrangement in which it is taking equity in lieu of fees.
Intense received £7.75m from 3i and ACT Venture Capital. Dundas head of technology Laurence Ward has been advising Intense, a start-up incubated at Glasgow University, for more than a year. The equity stake totals 4.7 per cent of the company and will be shared between Arthur Andersen and Andersen Legal/Dundas. Arthur Andersen will take 2.7 per cent of the company, while Andersen Legal, including Dundas, will receive 2 per cent. Despite many firms now rejecting the trend for taking equity in lieu of fees and the current economic downturn, Ward is confident that the move is a sensible one. Some firms have lost out after taking equity from unprofitable clients, but Ward thinks Andersen Legal can only benefit from hindsight. He also feels that, while bad decisions have been made in the past, the need for technology can only grow. "We've learned from the mistakes of others and will take a sensible and cautious approach to our investments," said Ward. "We also know that it's better to come in at the bottom of the market than at the top. We're very optimistic about the technology sector and technology companies generally. The need for communications won't go away, notwithstanding the current market downturn. We realise that this is a volatile sector but our commitment to it remains." Billy Harkin, strategic business development manager at Glasgow University, oversaw the initial deal between Andersen Legal and Intense. According to Harkin, if Intense is successful, Andersen Legal will, through its member firms, continue to advise Glasgow University-incubated start-ups for equity in lieu of fees. Glasgow University produces 12 technology start-ups a year.